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Nookie1986 [14]
3 years ago
11

In 5-10 sentences, answer the Question; What is a Market Economy?

Business
1 answer:
Ulleksa [173]3 years ago
8 0

Answer:

A market economy is an economic system in which the decisions regarding investment, production and distribution are guided by the price signals created by the forces of supply and demand. The major characteristic of a market economy is the existence of factor markets that play a dominant role in the allocation of capital and the factors of production.Market economies range from minimally regulated free-market and laissez-faire systems where state activity is restricted to providing public goods and services and safeguarding private ownership, to interventionist forms where the government plays an active role in correcting market failures and promoting social welfare. State-directed or dirigist economies are those where the state plays a directive role in guiding the overall development of the market through industrial policies or indicative planning—which guides yet does not substitute the market for economic planning—a form sometimes referred to as a mixed economy.

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A computer manufacturer sells laptops to retail stores for $450 each. If the manufacturer pays $200 for all of the components in
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